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February 05, 2013 at 09:44 AM
Principal Financial Group, Inc. (Principal) announced today that their $1.5 billion acquisition of Chilean pension company AFP Cuprum (Cuprum) is complete.
Originally announced in October, the agreement required Empresas Penta S.A., a Chilean investment holding company and Inversiones Banpenta Limitada to sell their 63 percent ownership in Cuprum. Principal now owns 90.4 percent of the company and will attain the remaining shares quickly.
Foreign Pension managers have been sought after by companies as the low interest rate environment restricts investment returns. With the Fed publicly stating that low interest rates will stay in place until 2015 and customers in many developed economies experiencing diminished purchasing power causing them to delay investment and insurance purchases for more immediate needs, expect the trend of looking to emerging economies to spread more and more in the coming years.
As many companies look to the bigger and more well-known BRIC nations when emerging markets are spoken of, South America often has less bureaucratic hurdles, a faster growing and more stable middle class, and higher private savings rates.
